A transportation management software, also called a transportation management system or TMS, is a type of software that uses technology to help companies plan, execute, and optimize the physical movement of goods, both arriving and leaving.
At the same time, a TMS ensures compliance and adequate paperwork. On the other hand, a factoring company allows a transportation company to get paid fast. It lets a transportation company receive same-day payment for loads performed.
Hence, integrating a TMS with factoring software makes transactions more straightforward and efficient for transportation companies.
If you’re wondering how to integrate the robust FlexTMS with Apex Freight Factoring, this article will show you how.
What Is A Factoring Company?
At its most basic, a freight invoice is a piece of paper that the receiving party signs when you deliver a consignment. Their signatures indicate that they have accepted the load and intend to pay the trucking firm or owner-operator for the freight transportation.
Unfortunately, collecting an actual freight payment can take anywhere from a week―if you're lucky― to several months after the paper is signed. But you have a business to run, and you can't afford to wait weeks or months for the load you delivered the night before. You have debts to pay and need fuel to deliver your next cargo.
This is where factoring companies come in. Factoring companies exist to bridge the gap between completing a load and receiving payment for it.
Factoring allows trucking or transportation companies to earn money for their services significantly faster. It’s because the factoring company handles invoice payment processing and collection. In exchange for this service, the trucking company gives a small portion of the money to the factoring company.
On top of that, factoring companies often demand additional fees for their services, thus reducing the amount of money you earn on that load. However, trucking companies are prepared to make the trade to keep their wheels going.
How Does Truck Factoring Work
Factoring refer to the sale of your cargo invoice to a company that specializes in collecting and processing them. Typically, the factoring firm will pay you nearly the full earnings of the load within a few days, but they will charge you a portion of that amount as a fee in exchange for their service. The invoice is then removed from your hands, and you are free to continue operating with money in your pocket while the factoring company collects the invoice.
The process includes the following:
1. The trucking company transfers the load for the customer, delivers it, and obtains a signed invoice.
2. Then, the company sends a copy of the invoice to their preferred factoring business.
3. Within a few days of receiving the invoice, the factoring company gives the trucking company an advance (a percentage of the invoice's value).
4. Up to 98% of the original invoice's value may be paid to the trucking company.
5. The factoring company handles the billing and collection from the customer.
Benefits of Apex Integration
Factoring businesses assist transportation companies through quick and dependable cash flow by purchasing freight bills. Trucking companies have numerous upfront and periodic expenses, such as fuel, tires, truck maintenance, insurance premiums, truck payments, and wages. As a result, having a strong cash flow is critical to the profitability of your trucking firm. Working with a factoring company can be beneficial if you need to handle cash flow concerns or pay short-term bills, especially if you are unable to obtain bank financing or require speedier access to capital. If you don't mind giving up management of your bills and trust the factoring company to deal with your customers effectively, factoring may be a better option than invoice finance.
Here are the main benefits of integrating your TMS with factoring software:
Increased cash flow
The number one reason trucking businesses fail is a lack of or zero cash flow. When you don’t have regular cash coming in, you can’t pay your business bills on time, fuel your trucks, and keep your drivers on the road.An invoice factoring company helps you if you require operating capital to bridge a cash gap while waiting for consumers to pay their invoices. According to research, more than 25% of customers in the freight industry don’t pay their bills on time. The average period for paying invoices in the industry is 40 days. Some companies take 90 days or more. That’s a long time to wait for payments for deliveries you’ve already done. This is where freight factoring comes in. It provides same-day pay, allowing your tucking business to get cash regularly.
No human error
You can process invoices automatically through Apex integration. By leveraging the Apex integration, FlexTMS eliminates the need for manually entering data. The process happens without human involvement, which decreases error.
Customers can choose from different payment options
You may preserve your payment terms while running your business smoothly if extended payment terms keep some of your most significant customers satisfied.
Why Choose Apex Factoring?
When evaluating factoring rates and fees, it's always a good idea to go beyond the statistics. This is because not all factoring companies provide the same services. So, when comparing factoring rates, consider what your firm requires and what you will receive if you choose that factoring provider. Factoring firms charge a modest percentage of each invoice factored. They will examine the customers you haul for, the volume you expect to factor in, whether you choose a recourse or non-recourse factoring strategy, and the risk associated when determining a factoring fee. Fees might be set to meet your specific requirements. Some scenarios call for flat charge arrangements, while others require prorated ones. Prices are negotiable with the factoring company and vary depending on the client.
For trucking companies, factoring is all about cash flow. Cash flow keeps a transportation company running. Freight factoring entails having ready finances for fuel, payroll, repairs, and other expenses. It's a simple approach to managing your trucking company's cash flow.
Apex Factoring purchases bills for freight that has already been delivered. Thus, the process produces advanced cash on accounts receivable. Freight factoring keeps the money flowing, allowing you to keep accepting loads.
Apex’s trained sales team (humans, not automated voices) will learn about your needs and those of your trucking firm. They will explain how Apex factoring works, answer your queries, and create a personalized plan.
At Apex, one size does not fit all. They offer recourse and non-recourse alternatives, as well as 24-hour factoring, online account management, back-office assistance, a free mobile app, free fuel cards, and much more. Your questions and concerns will assist us in developing a program that will keep your trucking company functioning smoothly.
Apex Integration: How to Integrate FlexTMS with Apex Factoring
FlexTMS, an all-in-one, cloud-based transportation management software, can be easily integrated with Apex Capital’s freight factoring solution. By integrating factoring into FlexTMS, transportation companies can enhance cash flow and save time with accounting.
Many transportation companies often work with tight margins, so factoring will help them to maintain a consistent cash flow with quicker payments. This allows trucking & transportation companies to get paid quickly, haul more loads, and grow faster.
FlexTMS’ integration with Apex Capital means that FlexTMS users can directly connect to their Apex Freight Factoring accounts without leaving the FlexTMS app. Apex integration allows carriers to sync FlexTMS/Apex customers with one click, coordinate invoice details and required documents to the Apex billing portal in seconds, automatically get all relevant Apex invoice information, and monitor invoice status.
In turn, FlexTMS can show the invoice status, sent date, and time to let the user know that the invoice was created. Once the invoice gets sent, users can log into their Apex billing portal to submit the created invoices.
This allows users to process payments in minutes rather than weeks. It also means that trucking businesses can keep the cash flowing and the loads rolling.
In addition, FlexTMS helps trucking companies find the most profitable load and get paid for that load faster with the Apex integration.
The Apex integration is smooth and passes information quickly between FlexTMS and Apex factoring. It greatly benefits the trucking and transportation companies involved.
Here’s how you can quickly do the Apex integration:
- First, log in to your FlexTMS account.
- Go to Settings and look for the Factoring tab.
- Click Connect and enter your Apex Capital API.
- You’re done! Your FlexTMS and Apex integration is successful.
- Start using the Apex integration by submitting the required documents, such as proof of delivery.
So, is Apex integration worthwhile? Of course, yes. Apex integration lets you get paid faster, saving you a lot of headaches from collecting invoices yourself. You can then use the cash flow to get more loads and increase your trucking company’s revenue. Want to try getting paid faster and with fewer headaches? Try the FlexTMS and Apex Integration now! FlexTMS also offers custom transportation management software to trucking companies with over 100 trucks.